𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Rachel Reeves has been warned that her Budget will likely trigger an “exodus” of wealth, investment and opportunity to “more competitive jurisdictions” away from the UK. Nigel Green, the CEO of financial advice firm deVere, thinks the Chancellor is set to pull fiscal levers in order to raise revenue, including freezing tax thresholds for even longer, which the Prime Minister, Sir Keir Starmer, failed to rule out yesterday; tightening reliefs, establishing new bases for existing taxes and introducing fresh obligations on income streams previously untouched by National Insurance.

Mr Green said: “Every indication points to a Budget built on a patchwork of tax hikes that raise the overall burden without altering some of the headline rates. A freeze that runs for years becomes a tax rise in everything but name. People feel it the moment they drift into higher bands, lose allowances or face limits that no longer reflect real-world prices.” He added: “The UK is edging toward the point where the effective burden crosses the line of tolerance.”

The income tax threshold freeze enacted by the previous Tory Government is already pulling millions into higher rates through fiscal drag, and extending it toward the end of the decade would generate billions more, experts say.

Mr Green said that the same dynamic applies to inheritance tax, where a long-running freeze on the nil-rate bands is pushing more estates into liability as property prices have climbed.

The expert believes property taxation could form another pillar of the Chancellor’s revenue plan, including expanding top-end council tax bands, restricting capital gains exemptions on high-value homes and revisiting how second homes are treated.

Rental income could also be swept into National Insurance, which HMRC could roll out efficiently using an incoming digital-reporting system, he suggested.

Mr Green said: “This is exactly how asset migration begins — not in a single headline measure, but in an accumulation of decisions that raise the friction on savings, property and investment activity.”

It is thought that Ms Reeves could also tweak pension tax relief, as well as introduce a levy on pension fund values.

Mr Green said: “When a government relies on a smorgasbord of hikes — freezes, narrowed reliefs, new NIC liabilities, pension tweaks and property adjustments — it becomes clear the objective is revenue extraction rather than growth.

“This is when capital flows elsewhere.”

Ms Reeves said in her pre-Budget speech earlier this month: “As I take my decisions on both tax and spend, I will do what is necessary to protect families from high inflation and interest rates, to protect our public services from a return to austerity, and to ensure that the economy that we hand down to future generations is secure, with debt under control.”